Foodmart, Inc. is a retail grocery store chain based in Any State, U.S.A. Foodmart has stores throughout the United States. Brian McDonald works as the produce manager for the store in My Town, U.S.A. Jeremy Atwater, 17 years old, is spending his summer vacation working for Brian in the produce department.

Scenario 1: Foodmart contracted with Masterpiece Construction to renovate the store on Main Street in My Town. Masterpiece, unable to complete the renovation within the 6-month time limit due to an increase in new contracts, subcontracted the job to Build Them to Fall Construction. Foodmart was unaware of the subcontract. When Foodmart realized, due to the poor quality of work, that Build was handling the renovation, Foodmart petitioned the court for an injunction and sued Masterpiece for breach of contract and specific performance. Masterpiece argued that it had a right to delegate the duties of the contract, or to discharge the contract due to commercial impracticability. Who wins? Explain your answer. Summarize the legal defenses to contract formation and enforcement.

Solution Preview

Masterpiece wins this lawsuit because there has been no material breach of the contract. As such, specific performance is not available as a remedy.

Breach of contract is a legal concept in which a binding agreement or bargained-for exchange is not honored by one or more of the parties to the contract by non-performance or interference with the other party's performance. If the party does not fulfill his contractual promise, or has given information to the other party that he will not perform his duty as mentioned in the contract or if by his action and conduct he seems to be unable to perform the contract, he is said to breach the contract.

One remedy available for breach of contract is specific performance. Specific performance is a court order requiring performance exactly as specified in the contract. This remedy is rare, except in real estate transactions and other unique property, as the courts do not want to get involved with monitoring performance. So, even assuming there had been a breach, specific performance would not be a likely remedy. More probable, damages would be awarded for Foodmart ...